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Deploying Customer Data for Better Retention and Acquisition

tags CRM & Analytics

Are you making the most of your customer data, or are you leaving this goldmine untapped? Leveraging customer data can help you acquire more customers, reactivate inactive customers, retain customers, and enhance the overall customer experience. 

Learn how you can use data to implement customer retention strategies and achieve your customer marketing goals.

1. Map it! Use data to tell the customer story.

Digging into your data can help you map out the path your customers take from showing initial interest at the top of the sales funnel all the way to making a purchase and beyond. For example, you may find that most customers need a certain number of touchpoints before they make a purchase. 

You can also gain insight into how existing customers interact with your brand. You can use your data to answer questions like: 

  • How often do customers purchase from you?
  • In the case of subscriptions, do customers tend to cancel after a certain duration or after the discounted rate ends?
  • What does it take to get customers to download a loyalty app or make another purchase?

Mapping the customer journey can help you meet customers where they are and use targeted strategies to push them in the right direction, whether that’s customer engagement strategies for an initial purchase or customer retention strategies for continued engagement with your brand. 

How well do you know your customers? Learn how to employ customer data for more  targeted marketing campaigns in our free guide Customer Analytics 101: How to  Derive Data-Backed Insights. → 

2. Group it! Use data to segment your customers.

Customer segmentation analysis is the practice of grouping customers into categories based on shared characteristics. These could be demographics, psychographics, buying behaviors, digital behaviors, or any combination of these factors. 

Understanding the different segments within your customer base can help you connect with each segment more effectively. For example, your brand may appeal to a variety of age groups, but Gen Z customers have a different set of priorities and preferences than millennial or Gen X customers. If you want to speak to these specific priorities and preferences, you need to tailor your messaging and marketing campaigns for each customer segment. 

You may also find that certain customer segments are more valuable to your brand than others. These are the customers you should target in your acquisition and retention campaigns. 

How well do you know your customers? Read “How to Earn Positive ROI from Analyzing Your Customer Database.”

3. Quantify it! Use data to analyze customer lifetime value.

You can also use your data to break down the value each of your customers brings to your business over the course of the customer lifecycle—a metric known as customer lifetime value (CLV). The most basic way to calculate CLV is to multiply a typical customer’s average order value by the total number of purchases they make. 

A low CLV may indicate you need to concentrate on improving your customer retention and engagement. Consider cross-selling and upselling to boost the average transaction value, as well. 

CLV is typically most helpful when you consider it in context with some other factors. For example, you can calculate CLV for different customer segments to learn which customers are your VIPs. It’s also smart to compare your CLV to your customer acquisition and customer retention costs to ensure your marketing investments are paying off. 

4. Extrapolate it! Use predictive analytics for customer retention strategies.

You can also use your data to predict the future. If you want to better serve and connect with your customers, you first need to anticipate their needs and behaviors. 

There’s no need for guesswork when you can analyze historical patterns of customer behavior to forecast future trends. For instance, you may find that a certain customer segment is most likely to shop online when you issue a 20 percent off promo code, or that certain customers are seasonal shoppers. Detecting these patterns can help you plan for the future.

According to McKinsey research, the future of enhancing the customer experience will increasingly depend on precise predictions that are clearly tied to business outcomes, and companies that start embracing this transition will reap substantial rewards. 

This process does require some sophisticated mathematical analysis if you want to generate detailed future predictions, so it’s best to tag in an expert. A customer analytics partner will be able to analyze and extrapolate your data to create precise models for future predictions. 

5. Don’t go it alone! Partner up to make the most of your data.

If you want to make the most of your data, you should work with a customer analytics partner. An expert in CRM and analytics can help you generate, interpret, and leverage data using the right tools and strategies. With the right partner, brands of all sizes can improve their customer acquisition and retention strategies to improve outcomes. 

Outsource any responsibilities where you lack the in-house expertise and resources. The right partner should work as an extension of your marketing team and fill in the gaps where needed. For many brands, the best approach is to work with a partner who can manage their customer analytics and marketing all the way from strategy through execution and analysis. 

Ready to get started? Learn more about leveraging customer analytics in our guide, Customer Acquisition 101: How to Use Customer Analytics to Earn New Customers.

Customer Analytics 101: How to Derive Data-Backed Insights

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